10 things to remember when pitching investors

July 12, 2017

Venture capital investment in UK startups is booming, with over £800m invested in the first quarter of 2017.

Investors are easier to find and get the attention of then ever, as they boost their social media presence. Tools and platforms such as Angel List offer you the chance to conduct a granular search for your perfect investor. But what happens when you get your pitch date?

Here’s a list of tips to boost your chances of securing funds when pitching to investors.

1. You can't be over-prepared

Having an awesome product is only part of the equation; you have to back it up with a strong pitch. Make sure you know what you want to say and ensure that you have prepared it well in advance. While you might think developing a few cue cards on the train the night before will do – if you are serious about getting investment, your pitch should take days to put together, not hours.

2. Practice makes perfect

Once you have come up with the perfect pitch, practice until you are bored of your own voice. As anyone who has watched an episode of Dragons Den knows, if there is something that will instantly turn an investor off it’s a stumbled pitch. You need to be so deeply entrenched in your brand that cue cards just slow you down. Practice will help you to hone your pitch to perfection.

3. Get your timing right

Having the ear of a potential investor is a fantastic opportunity – but make sure you don’t bore them with a two-hour history of your career. The initial pitch should be concise and punchy, giving them just enough to keep their interest, but holding back enough to allow for questions. If you have done your job, the investors will have a full understanding of what you have to offer and can focus their questions around the specifics of the investment.

4. Research

Of course, you know your brand and product inside-out, but understanding who you are pitching to is just as important. There will undoubtedly be questions like: “Why do you think I am the right person to invest?” – doing your due diligence will help negate stumbling blocks like this. Just as important is understanding your market. Who are your competitors? If there are none have you thought about why? What is it that makes your product different to everything else? These questions will definitely be asked, so make sure you have thorough answers.

5. Have a bulletproof business plan

Your business plan is the cornerstone of any investment deal – it will be the foundation on which you build any agreements of finance and may even dictate how much funding you get. Your predicted growth and current earnings need to be perfect. If you have only made £25,000, yet are valuing your business at £1 million – there is something very wrong – make sure your sums add up or you will be laughed out the pitch.

6. Get media attention

The success rate of startups that have already had some sort of mention in the media versus those that don’t is much higher. Coverage in relevant publications or websites is gold dust to investors, as it shows that experts in the industry take you seriously. It will validate your product amongst your peers – creating a picture of success for your startup.

7. Don’t go it alone

Sometimes you can get so involved in your product that you lose sight of what is important and what the focus needs to be for your pitch. Hiring a business consultant or advisor can bring the clarity that is needed to create a great pitch. When choosing an advisor, make sure the person you chose has been there before, and preferably has succeeded in gaining investment. While advice from someone who understands business is great, someone who has been in your shoes will much better understand the task at hand.

8. Don’t get taken for a ride

Consider also getting legal advice before the pitch. Investors are incredibly savvy people, and know how to get the best possible deal. Make sure you know how much you are willing to give away for your investment and make sure you have a buffer either side that you are willing to move to. Legal advice may seem like an unnecessary cost, but could save you thousands in the long run.

9. Make an effort

Many of today’s most exciting startups come from areas of London, Berlin, New York or Silicon Valley where it is totally acceptable to turn up to meetings in jeans and a T-shirt. However, your investors may not be cut from the same cloth. Consider that a potential investor might come from a banking or finance background where he or she wore a pinstripe suit day after day for 25 years. You could have the greatest product in the world, but if you turn up looking like a college drop-out, you may well be treated as such. This meeting may be one of the most important of your career – buy a suit, have a shave and shine your shoes – you never know how far it can go.

10. Be proactive

Once your pitch is over, you might think it polite to sit and wait for the phone to ring – however, just as with any job interview – investors appreciate proactivity. A well-worded email or letter can earn you brownie points that could seal your financial future. This should reiterate the points from your pitch and include any information that might help close the deal.

This blog is the latest in a guest series from Clarity PR, a global technology PR company with offices in London, New York, and Berlin.